Chasing

The market had a very nice day yesterday with the SP500 gaining +1.37% and the Russell 2000 +2.15%.  This morning the SPY is building on that gain with a 1 point gap up.  It's a little hard to get excited after huge up days because the market has had a hard time following through to the upside when most see it has a good "technical set-up".  We've enjoyed the best follow through from oversold levels, by the time most consider the market in "good shape" it has run out of juice.

This time like always could be different.

With that being said, AREX, DNR, RYAM, YELP, BTE, VMW, OLLI, AGN, WLB, LGCY, GNW, are the stocks on my swing trading watchlist for today.  GOOGL +$15, LNKD +$3, were the big standouts yesterday.

The rules are simple;

• Only get involved if they go through yesterday's high plus a few pennies.
• Based on the chart patterns, the stops are close and clear.
• Either the market will get you in or keep you out.
• I only play this list one way, LONG.
• Stocks move in momentum burst of 3-5 days (stockbee), you want to buy on the first day and start unloading on the way up and on days 3,4,5.
• You are going to be wrong half the time.
• Position size makes all the difference in the world.
• I work with a price stop and a time stop.
• Stocks in the short term move from 52-week lows, 52-week highs, all time highs, etc.
• Contraction leads to expansion; this happens at lows, highs, middle, etc.
• I tend to stay away from buying stocks in the first 15-minutes.

My opinion and outlook are subject to change as new information comes in. 

Frank Zorrilla, Registered Advisor In New York. If you need a second opinion, suggestions, and or feedback in regards to the market feel free to reach me at fzorrilla@zorcapital.com or 646-480-7463.

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.